E. Damages in the Damages Phase

• Library: South Carolina Damages (SCBar) (2009 Ed.)

E. Damages in the Damages Phase

1. General Tort Principles Apply

Generally, civil conspiracy damages follow standard liability rules. For example, the damages must result "proximately" from the wrongful act;³² whether the damage did result "proximately" is ordinarily a jury question;³³ required is only a "reasonable basis" for computation, not "absolute exactness,"³⁴ or "proof of the fact of damages, not certainty of amount."³⁵

Accordingly, this section will focus on issues unique to civil conspiracy damages and otherwise ignore ways in which civil conspiracy claims follow the general rules of damages.

2. Specific Items of Damage

a. Temporary Decline in Value of Property

A dispute over several tracts in an ongoing development was at issue in Peoples Federal Savings & Loan Ass'n of South Carolina v. Resources Planning Corp.³⁶ The Special Referee had found that the developer and others had conspired to harm the investor S & L by, among other things, placing grossly excessive assessments on the investor's tracts.³⁷ He awarded "special damages" for the temporary decline in marketability of the investor's tracts.³⁸ Rejecting a claim that recovery for temporary, non-physical injury to property is limited to the loss of rental value during the time of the temporary injury, the court held that damages are proper for a temporary decline in marketability "during the pendency of the assessments, initiation fees, and ensuing litigation."³⁹

b. Cost of Carry/Holding Costs

Holding or carrying costs are appropriate elements of damages in a civil conspiracy claim concerning realty. Holding costs are "expenses such as insurance or taxes associated with 'carrying' property over a period of time."⁴⁰ Holding costs are "appropriate" elements of damage.⁴¹

c. Ruination of a Business

Elements of damages for conspiracy to ruin a business include: (a) "the specific items of loss and damage traceable to the acts of the defendants in specific transactions;"⁴² (b) "the loss and damage inflicted on the plaintiff in the destruction of particular items of his business;"⁴³ (c) "the difference between the agreed price of something contracted for and its ascertainable value or cost;"⁴⁴ (d) "profits which have been prevented;"⁴⁵ and (e) "the loss of profits that he will sustain by reason of the permanent damage done his business."⁴⁶

To predict those future lost profits, elements to be taken into consideration include: (i) a reasonable life expectancy for the plaintiff;⁴⁷ (ii) the volume of business done by him at time of the wrongful acts;⁴⁸ and (iii) his proven ability to increase volume over time.⁴⁹

Such elements of damage do not include "the profits of dependent and collateral engagements or those contingent upon future bargains, speculations, or states of the market."⁵⁰

d. Defrauding the State

Where government officials and a corporation conspire to defraud the state by overcharging for certain supplies, damages are determined by the difference between the contract price and the fair market price.⁵¹

3. Each Conspirator Liable for Wrongful Acts of All

A notable aspect of civil conspiracy cases, and one reason a plaintiff may wish to charge civil conspiracy rather than the underlying tort, is that in civil conspiracy, each conspirator is liable for the wrongful acts of all. Once it is shown that a given defendant was involved in the conspiracy, it makes no difference in assessing actual damages that his own actions were thereafter harmless.⁵²

4. Punitive Damages

a. Availability of Punitive Damages

"[Punitive] damages may also be awarded where the gist of the [civil conspiracy] action is the injury resulting from malicious acts and the amount is...